Only Happy When It Rains (ft Jae Um and Ed Sohn)

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Hello everyone.
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Welcome to further comments.
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Really thrilled to be here with my friend Horace Wu.
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Horace, how are you?
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Hello Damien.
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I'm doing very well.
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It's great to see you.
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Uh, really great to see you.
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Uh, we get, we were able to see each other last week at LegalWeek, and of course, now here we are back in our respective homes, licking our wounds and, recovering from Legal Week.
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This is season three.
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Uh.
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Season three! So exciting.
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Uh, so the first episode of season three.
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We've talked about how we wanna bring smart people, uh, to be able to say smart things on our podcast, and we're thrilled to be able to have two smart people.
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Two of them! In a single episode! In a single episode to two for the price of one.
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Uh, Ed and Jae, uh, welcome to the show! And maybe you could introduce yourselves to people who don't know you.
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Great.
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Uh, glad to be here.
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Season three is historically, always the best season of anything.
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And so we're, we're glad to kick it off.
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My name is Ed.
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I am an attorney and a technologist by training.
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I'm a co-founder and the Chief Product Officer and general counsel at Lumio.
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I've spent my career after five and a half years as a practicing litigator at King& Spalding, in an oscillating career between managed services and product management, technology and innovation, um, at places like Thomson Reuters, EY, and most recently on the management team at Factor.
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But it's been, we are over a year into our world at Lumio, and I am based in Atlanta, and we are super excited about what we're doing.
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Awesome.
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Hi.
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I'm thrilled to be here with three of my favorite people.
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My name is Jae Um.
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Jae, like the letter; Um, like you don't remember.
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I am the Chief Growth Officer and head of knowledge at Lumio.
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As far as my background, it's a long story.
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I've done many, many things, but I think people know me, uh, primarily as a commercial analyst and strategist.
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I am a, uh, student of legal markets, observer and watcher of people on things.
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And I am probably best known for using lots of emoji as I comment on the future of the legal profession and the business of law.
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I also have, written for the American Lawyer's AmLaw 100 issue for the last five years.
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And, you know, I am the creator of the power rankings where I try to look into the crystal ball and gaze into what the future may hold for some of the best lawyers and law firms in the world.
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And one, one of the best things that I love about Jae and Ed is that a lot of people when they speak, the signal to noise ratio is quite low.
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That is, there's lots of noise to signal.
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I would say that with Jae and Ed, it's almost a hundred percent signal.
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Uh, if there is noise, I, I haven't heard it yet.
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Every conversation I have with them is, is high signal, almost no noise.
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And I, I expect this to be no, no different.
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I, I. Like super happy and honored that you guys have decided to join us.
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'cause I met you guys last week and saw what you are working on and I was blown away.
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And we'll get onto that in a little bit because I think like it deserves a lot of airtime.
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But it's cutting through the noise that was legal week, right?
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Like everybody was AI.
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Everybody, I think the more matured offerings are now integrated.
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And they don't really like flash AI in neon anymore.
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But there were still people who were doing "AI! AI! AI!" And I think what you guys have done is, is, it's an extremely mature application of, of, of AI.
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But before we go on to talk about what you are doing, what's your take on the current market in 2026?
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Like, in terms of the Gartner hype cycle?
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Where are we in that cycle?
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Oh boy.
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Well, I think that, one thing that is very interesting about legal, um, and I've written reams about how legal's not unique.
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It is an extreme market, but it, it is prone to some of the same behaviors and some of the same pressures and trends as other industries.
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Definitely is the case here.
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I think what is really interesting to me is the dispersion of viewpoints.
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Uh, depending on who you are and where you're sitting in the marketplace.
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Like there are still people who are very at the peak of you know, hype, like unrealistic expectations, especially when it comes to ROI.
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I said on my panel, ROI is the new black.
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That's what everybody's gonna be talking about.
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Um, and I think probably a lot of reductive thinking about what the path is gonna look like from tool purchase to, you know, being able to show a clean spreadsheet with like, what that did to the business.
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I think, um, so some unrealistic expectations, a lot of fatigue, generalized fatigue.
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People seem to get annoyed when they hear the, the syllables "AI".
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Um, so that tells me they're deep in the trough of, uh, disillusionment.
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But I think that, uh, some of that feels to me a little bit directionless and, um, atmospheric, rather than driven or triggered by, you know, specific experiences.
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So that, that dispersion is really interesting.
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But I will say this, real things are happening at great pace and volume.
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Lot of people are working really hard, to really understand how AI makes contact with lawyer reality, with legal services reality.
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Um, I think some of the comments I made on my LegalWeek panel, I, I repeat, you know, in a truncated way.
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Which is that I think we do ourselves and each other a disservice when we generalize to the wrong segments.
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Like, you know, what are clients doing?
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What are firms doing?
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Well, a handful of clients are way out front being very aggressive with, um, automation and sourcing.
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Um, most are actually, you know, way far behind.
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Like the, I would say the top five that I know of are, are many, many miles ahead of almost everybody else.
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Uh, firms are catching a lot of flack because, you know, they're not giving easy to understand, repeatable, viral answers on what it's gonna do to pricing.
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Um, I would tell you from my experiences in legal business strategy and, and pricing, that's gonna take a couple years to shake out.
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Um, you know, that notwithstanding a lot of firms are actually quite far, uh, in, in tool evaluation and lawyer consultation, pilots.
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And actually, you know, pretty structured studies as to what AI is doing, not only to the provision of services today, but the training of lawyers in the next generation.
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And then, so I think there's a lot of work ongoing, but, uh, people are talking past each other and then, so I think a lot of the disillusionment, a lot of the, the negative kind of backlash is really overinflated, um, in this echo chamber.
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So I, that is something I've been trying to shift through many waves of change in this industry.
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I think, um, clear eyed positivity is really important.
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More important now, now than ever, I think.
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What I'll add to it is a little bit more from the product perspective and looking at the, the kind of approaches that are in the market.
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Jae and I have talked about this before.
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We need to kind of write this down and put it into an article.
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There are multiple hype cycles and they're cascading on top of each other.
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There is not one hype cycle.
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You cannot say there's AI in legal and it is at a peak of expectations and then a trough of disillusionment.
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And it doesn't track quite so, neatly because there are multiple use cases.
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But actually what's more important than the use case, uh are... 'Cause what is the hype cycle actually measure?
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It measures adoption and maturity, right?
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That's actually what it measures, right?
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And it's, it the inflection of attitudes that are kind of charted against the maturity of like where technology actually diffuses into a user base.
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Um, and really actually technically it's got buyer base.
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The thing about AI in legal is that the thing that phases the multiple hype cycles all kind of being phased on top of each other is primarily that people are on three or four different journeys.
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And so they're, they don't necessarily coincide.
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And that's where Jae talking about how people are talking past each other.
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It's because they're like,"man, this is a great trip." It's like, "no, I find it rather bumpy." It's like, "no, I find it rather smooth." And that's 'cause one person's in an airplane and someone else is on a train.
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Like they're, they're in different vehicles and they're also not even heading to the same destinations.
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Boy, there's a lot of turbulence.
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Mm No, it's completely, it's completely clear.
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That's 'cause somebody's flying to Vancouver and someone else is flying to Miami.
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Like there are different paths and different destinations on different modes of transportation.
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And so because of that, the hype cycles are kind of all at different moments of cresting.
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And you'll hear this kind of dissonance when you talk to, you know, providers on the exhibit floor, talking heads on panels, you know, buyers trying desperately to bring coherence to their AI strategy, what they're being asked to provide.
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And there's just a real need for some clarity.
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And adoption of oftentimes in the maturity of those products depends on multiple things.
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But one of them, uh, I'll just, I guess I'll mention two off the top.
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One is, um, the incentives.
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I know Damien talks about this all the time.
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Um, incentives matter to adoption.
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An environment that is conducive to adoption is not merely a matter of I have this problem and this solution fits it.
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It is not as simple as that.
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There is a broader context and a, an environment with conditions that are conducive to the adoption, where there's motivation among users and buyers and makers that are, that find some level of alignment.
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But the other thing is that the disruption is, and the technology that's being released, and we now can see, look around the corner a little bit.
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Because actually the technology and the rate of AI progress is far ahead of kind of the pace of adoption.
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We've been saying that for a little bit.
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I've got like a wonky line graph that kind of shows this.
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Claude Anthropic recently released kind of like a radar graph that kind of shows like where the potential disruption is and where the maturity is.
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Um, but that gap, um, is being traversed.
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And along the way a lot of the products that are desperately trying to make them make the case that they're indispensable will be quickly disposed actually.
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And so that's, that's the moment that we're in and that's why there's a lot of kind of talking past each other.
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The last thing I would mention, and we can talk about this, you know, sort of in more detail, is really the basic minimum viable quantities the assets that are required to actually have AI make contact with reality and stick.
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And those are not just the environmental kind of atmospheric conditions, nor are they sort of just the sufficiency of the technology and the ascertainability of the problem, but actually it has to do with the user experience.
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And that's where like a lot of product people like to talk about adoption, which is like, how easy is it to work with?
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How easy is it to adopt?
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And I think that because AI is a completely different beast, um, there are not, there's not one path to user adoption.
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Um, and there are a lot of people kind of all moving in different directions along it.
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It's not as simple as, well, it's a React web app and it's so beautiful and oh my gosh, people are just gonna know.
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There's tool tips.
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You hover over a button, it tells you what it does.
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Oh my God.
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Like we're not in that world anymore.
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That is like one of many canvases where AI can be expressed and kind of like, uh, the benefits of it can, can be, um, accessed by users.
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And so those are all different things that are happening at once.
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And that leads to a lot of chaos because I think all of those things compound on each other, so that someone's like, oh, I'm on an airplane to Vancouver.
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I'm on a train to Miami, and someone else is speaking like Italian and even the same language.
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And so these complexities all stack on top of each other to, to reveal a lot of noise and chaos.
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You might think that I get to do this all the time because Ed and I, uh, started a company together.
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But no, we don't get to sit and talk, uh, you know, interesting talk about the state of the world.
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So I'm, I'm reminded how much I miss it.
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Let me add on to some of the things that Ed is saying.
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Just to kind of help people make sense of why all this is the case.
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AI is, I think, the most personalized, you know, technology that's, um, ever been.
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And that's got lots of good to it, and it's got a lot of hidden, uh, I think pitfalls and traps.
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So when I say AI is fundamentally a personal technology, it means the, the actual user experience varies quite a bit from person to person, right?
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And that level of variation is something that is totally new to the change agents and managers who have set, um, adoption strategy before.
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I think too, to put like kind of concrete point on what Ed is saying in terms of, you know, people headed to Milan versus like Miami or Tampa.
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I think that, you know, a lot of folks are pointing AI at, you know, maybe known, known solutions to known problems, or new solutions to known problems.
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It takes a lot of thinky pain and sometimes thinky pain that is shared in a group to see white space for new ways to tackle new problems that you know, we haven't encountered before.
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Like either because they were too difficult with available technology.
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I think, you know, seeing that kind of like new Horizon is very hard.
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I see very few teams doing that.
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Um, but you know, some people are, and then, so depending on what you're trying to do with the AI, um, it, it goes beyond use cases because the, the, uh, bionic collaboration between user and technology is, you know, in a sphere that we've never really made contact with before.
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And then it takes a lot of active use and active thinking from the user, um, to think of, you know, the ways that AI can add value or create value in totally new ways.
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And then, so I think that is something that is creating stochastic variables.
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Like the jagged frontier of AI capability is one thing, but the jagged frontier of human imagination is another.
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And I think that actually is, is a far greater and more intense pressure to cope with.
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And, and in terms of user experience.
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I think that something Ed and I have, suffered a lot of thinky pain about, uh, before we decided on our user experience is that term and the concept U of UI is really fundamentally changing.
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A lot of... and I am a, a lifelong lover student of design.
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I think a lot of UI and UX, um, engineering in the past has gone into thinking about affordances and workflows, right?
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So the very mechanical, just collision of user to the technology.
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What does the user see?
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What was the user thinking before?
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What can the affordances signal to the user as to what, you know, functionality features are available?
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Um, and really because AI capability is so deep and vast.
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Right?
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And the interface that most of us made contact with first is really just like a cursor in a blank space.
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Um, I think it gives us, actually, yes, the challenge with the opportunity to really rethink what is the problem space that we could attack?
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What are the solution spaces that we can explore?
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Like the concept of solution architecture and problem awareness.
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These are actually deeply human problems, not necessarily technical problems, right?
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So understanding the human experience, the psychology that, um, users bring to the interaction, the business and work context around that user.
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Because we are generally in an enterprise space.
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And the work context that exists not only around the user but around the enterprise as well, right?
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And then what is the opportunity space that they can attack?
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What is the value proposition that we are bringing?
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I think these are all much more important questions to answer now.
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Because each of us has an insanely scalable, powerful kind of capability and an army of agents to do our bidding.
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Making these tough choices about what we're gonna do with that and how we're going to communicate and show that value.
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These are all deeply human and business problems.
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A hundred percent.
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And, uh, one of the things that I love about you, Jae, is that, uh, not only your, uh, emoji, but your verbal emojis, like "thinky pain".
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I, I love, love, love that.
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Life is a PowerPoint, so this.
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Is a PowerPoint, uh, that is, it relates to what we're talking about, and it's actually got Jae and Ed, uh, featured on it.
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So there is a different hype cycle for the world versus governments versus, uh, you know, industries, uh, main street, law departments, everyone is in their different path of the hype cycle.
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And uh, and also the populace might not even be near peak, peak hype.
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They might not even know what's going on.
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And then you can say, okay, uh, maybe if you put them in this kind of list, you could be able to say, okay, this is where maybe everybody is along that list.
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But then you also have, you know, talking past each other, which, uh, you talked about is that, you know, is it, are we talking about advisory work or we talking about transactional work, or we talking about regulatory work, or we talk about litigation.
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Here is Jae Um and Ed Sohn, which I show to almost every person that I have say, what type of work are we talking about cream work or core work or commodity work?
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Uh, and because then, you know, what can AI do?
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What is the current corporate spend?
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And I'm sure you have different, uh, different numbers for this now, but, and how much can AI affect each of these?
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We can't talk, uh, we past each other to say, no, it's never gonna touch cream.
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And then you're saying, no, no, no, I'm talking about commodity.
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Uh, so each of these, you can think of almost like a, um, an X, Y, and Z, uh, where, you know, everyone is talking about a different thing, different parts of the, uh, the elephant.
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And so you can say like, the X axis is for whom is this happening?
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The y axis might be what is the type of work advisory, transactional, regulatory.
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And then of course, the Z is what value, what is the cream core and commodity?
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And you can imagine, as we discussed this, that's, that's maybe a way to be able to think about us thinking, uh, past each other and talking past each other.
00:17:38.151 --> 00:17:39.586
But I'm gonna add one more axis.
00:17:39.586 --> 00:17:41.355
So we're gonna enter four dimensional space.
00:17:41.405 --> 00:17:47.526
I think the thing that I'll add is, the, to what end almost.
00:17:47.526 --> 00:17:53.855
It's almost like what is the, what is the thing around which there is hype?
00:17:53.885 --> 00:17:56.226
Like even that by itself is a question.
00:17:56.256 --> 00:18:03.036
'Cause we keep saying it's like AI and it's vast intelligence and it's an army of agents and like, all true for sure.
00:18:03.096 --> 00:18:10.415
Like that is, there is something at the core of AI progress and something that has been invented and we can define it and point to it and look at it and it's moving super fast.
00:18:11.046 --> 00:18:11.976
Here's what I observe.
00:18:12.006 --> 00:18:13.655
Let's like get outta the theoretical for a second.
00:18:14.316 --> 00:18:24.615
I talk to law firms, when I talk to legal teams, when I talk to leaders of innovation and people whose job it is to really inflect a change that can be reduced to some kind of KPI on which they're evaluated.
00:18:25.185 --> 00:18:35.016
There is this idea of like, well, let's go try and buy some tools, Yep And like that's still in the mix.
00:18:35.046 --> 00:18:36.215
And that is absolutely.
00:18:36.215 --> 00:18:38.736
And, and like that's a familiar arena.
00:18:39.125 --> 00:18:43.086
People can talk about pilots stacking up on their desk and they can talk, you know, like, oh yes.
00:18:43.145 --> 00:18:44.586
Oh man, there's so much more now.
00:18:44.586 --> 00:18:46.296
And oh, there's so many new entrants.
00:18:46.296 --> 00:18:51.516
And then like Horace was saying, oh no, but like some of these new entrants, it's really just a feature on a bigger platform.
00:18:51.516 --> 00:18:54.395
And like, oh, there's consolidation in legal tech and et cetera, et cetera, et cetera.
00:18:54.695 --> 00:18:57.365
Now these two competing solutions are at the same house or whatever.
00:18:57.455 --> 00:19:01.806
Like there's like all of that navigation of the kind of legal technology procurement.
00:19:02.211 --> 00:19:04.000
Like view, right?
00:19:04.590 --> 00:19:08.810
But now there are builders and uh, that's kind of getting a lot of traction.
00:19:08.810 --> 00:19:17.346
You see some of those kind of building firms that are out there, um, that are making a difference in terms of getting better in-house solutions.
00:19:17.346 --> 00:19:25.506
We're not talking about sort of slightly rickety power apps kind of like stringing together some like real basic automation logic on the backend.
00:19:25.925 --> 00:19:33.155
Um, or like, you know, a little, kind of like a SharePoint page that's got a little bit of kind of, uh, power query behind it.
00:19:33.155 --> 00:19:40.566
You know, that might, I mean, look, some of those things were actually super powerful, but were not in the hands of like, really competent citizen developers.
00:19:40.566 --> 00:19:43.326
And like, couldn't actually kind of reach their thing, nor did they scale.
00:19:43.476 --> 00:19:46.865
Like, someone would make this one thing for this one thing, for this one place, for this one person.
00:19:47.105 --> 00:19:48.605
It'd be like, great, now can you do this?
00:19:48.605 --> 00:19:50.435
It's like, sure, I just have to start over from scratch.
00:19:51.576 --> 00:19:57.875
And so then the, but then there's this, the builders now have a completely different, it's a completely different ballgame for builders.
00:19:58.115 --> 00:20:08.226
And like, see, e.g., all of the advances in software development everywhere, vibe coding, you know, uh, Karpathy's auto research and like building a model from scratch now.
00:20:08.286 --> 00:20:12.455
And, OpenClaw and Claude work cowork and so many things now, right.
00:20:13.191 --> 00:20:18.711
But then that blurs the line to this third kind of user experience of like and the what of like what is the hype cycle?
00:20:19.131 --> 00:20:19.770
And that is like.
00:20:20.901 --> 00:20:31.396
Every once in a while, someone in like a management committee or the board of directors or you know, a senior executive is just like, well, I just heard that Claude is "legalling" now, so let's all just do that.
00:20:31.520 --> 00:20:31.851
Right?
00:20:31.851 --> 00:20:33.500
What is this Claude thing gonna replace?
00:20:33.500 --> 00:20:36.800
Like all the things that you guys are shopping and all these things that are stacking up on your desks.
00:20:36.861 --> 00:20:40.911
And I say that with caricature, but that's a very real thing.
00:20:40.911 --> 00:20:56.240
That's a very real voice happening where innovation chiefs who are like kind of meticulously putting together their kind of like tranches of strategies and use cases and what tools they're gonna pilot against them and how they're gonna prove ROI, are being confronted with like a leader being like, but what about this Claude thing I keep hearing about?
00:20:56.240 --> 00:20:56.691
You know?
00:20:56.990 --> 00:21:00.621
And uh, they, they released a legal thing and that dropped, you know, market value.
00:21:00.621 --> 00:21:03.471
And you guys have talked about that and we don't need to kind of like redo that conversation.
00:21:03.830 --> 00:21:11.695
But I guess what I'm saying is that some people who have taken the approach that AI is a more, uh, at large general capability.
00:21:11.695 --> 00:21:19.576
And the products in which it is interacted with require competence from its users no matter what shape or form, what pane of glass they're interacting with.
00:21:20.096 --> 00:21:26.486
And so then that journey is one of training, that's one of adoption, and like AI mindset and all of that.
00:21:26.875 --> 00:21:34.316
And those three things are themselves at odds a little bit because product makers are oftentimes like saying, you don't need to worry about prompting.
00:21:34.316 --> 00:21:38.395
You don't need to get that great at AI because we're going to hide that behind our wrapper.
00:21:38.635 --> 00:21:45.056
And you're gonna have a very consistent experience all the time so that all the wild variances on the backend, the product maker will bear the burden.
00:21:45.056 --> 00:21:48.836
Of like, you know, uh, evening all of that out and making that into a consistent approach.
00:21:48.836 --> 00:21:56.151
And frankly, some of the legal tech platforms out there have a lot of adoption and familiarity and people already know how to like, kind of work their way around them.
00:21:56.151 --> 00:22:01.221
And so installed user base, familiar experience, power of AI, like that's a good thing.
00:22:01.221 --> 00:22:07.851
So then why do we need to hammer these people over the head with like how to start using AI and like talking to machines and like natural language and whatever.
00:22:08.201 --> 00:22:12.701
And so even that fourth axis of like what is the what?
00:22:13.000 --> 00:22:19.451
Not just the work, not just the value profile of the work, not just the actors and like who, what they're, and not just the kind of business concerns.
00:22:19.691 --> 00:22:25.961
But even like when we say AI, like it means three people have three different visions for what that's actually gonna look like.
00:22:26.201 --> 00:22:30.070
And that, and where they're putting their effort and time and capital against.
00:22:30.070 --> 00:22:32.830
And I think that those are also disparate journeys.
00:22:33.815 --> 00:22:37.880
As we think about Claude"legalling" these days, something that Claude doesn't have is data.
00:22:37.950 --> 00:22:40.782
That is data that is, is stuck in Ed's and Jae's brain.
00:22:40.833 --> 00:22:45.218
Maybe we could pivot a little bit to talk about what you're building and how, Claude won't be able to do what you're building.
00:22:45.780 --> 00:22:50.911
Well, uh, you're setting us right up into the thing that we are really excited to talk about all the time.
00:22:51.580 --> 00:23:08.465
One of the things that we believe is that while legal work is a frontier that is about to be transformed, there's a different sort of as Jae mentioned, kind of like a new problem space or a new area that is, uh, something that we can now approach with AI that wasn't possible before.
00:23:08.465 --> 00:23:14.915
And that is the development of law partners in their commercial acumen and their ability to understand the business of their clients.
00:23:15.306 --> 00:23:23.726
And that is expertise that, Jae is very famous for, that I have some insight to as well in service, the general counsel's office for the last decade or so.
00:23:24.056 --> 00:23:31.046
And, um, understanding how we can take that kind of scarce expertise and deliver that.
00:23:31.076 --> 00:23:32.455
We know that it's delivery.
00:23:32.455 --> 00:23:40.790
We know that those insights as applied into the realities of, uh, buyers and sellers on both sides can be really effective.
00:23:41.090 --> 00:23:43.730
But we've never been able to scale it before.
00:23:44.181 --> 00:23:46.851
We've never had the means to scale it with excellence.
00:23:47.240 --> 00:23:50.840
And so what AI provides for us is the ability to do that.
00:23:50.840 --> 00:23:55.101
Now, how do we get that expertise out a way that isn't just out?
00:23:55.161 --> 00:23:58.550
It's not just like, well, Jae write a book, go into a cave and write a book.
00:23:58.790 --> 00:24:03.800
You're like the Dale Carnegie of legal and they come out and then you've got it all written down and it's perfect and beautiful.
00:24:04.270 --> 00:24:10.330
We know that that's not that, that we have an opportunity to structure expertise in a way that AI can command it.
00:24:10.691 --> 00:24:20.111
So that it can approximate the intuition and incisiveness of the insights that somebody like Jae walks into a room and everyone immediately acknowledges.
00:24:20.471 --> 00:24:24.671
They feel it like it's an art or like, it's an, it's an emotional quality, it's a temperament.
00:24:25.151 --> 00:24:26.830
Um, and how do you replicate that?
00:24:26.830 --> 00:24:29.231
Because partners can tell the difference, right?
00:24:29.231 --> 00:24:32.681
If we're really trying to change the lives of partners, partners can tell the difference.
00:24:32.681 --> 00:24:34.961
They know expertise when they see it.
00:24:35.385 --> 00:24:41.506
Almost every single one of them is one of the world's leading expertise in their area of technical performance, which is in legal work.
00:24:41.746 --> 00:24:47.635
But when it comes to commercial acumen and when it comes to their ability to actually grow their relationships, it's something else completely.
00:24:47.635 --> 00:24:56.866
So, our goal in our product is to create an expert AI teammate that helps partners decide where to hunt and how to close new revenue, profitably and with confidence.
00:24:57.226 --> 00:24:58.426
Uh, we think that's so important.
00:24:58.426 --> 00:25:02.715
I, I'll let Jae talk about why that's so important in this current moment in sort of the market.
00:25:03.106 --> 00:25:11.596
But I think the thing that answers your question, Damien, is, um, we have gone through the work of not just extracting and putting onto paper.
00:25:11.866 --> 00:25:16.646
And sort of like getting Jae to sort of author hundreds and thousands of pages.
00:25:17.086 --> 00:25:20.507
We have structured it in a way that we have these systems of expertise.
00:25:20.912 --> 00:25:37.711
Those systems both parse the unique contextual factors like what firm and what partner and who's this client and what sector are you in and what is your platform and like what quarter of the year is it, and what's happening like on the macro economic backdrop of the world, and what do they talk about at Davos and who just got fired by the Pentagon or whatever.
00:25:38.071 --> 00:25:44.192
Uh, and also on top of that, getting a read into these very local situation.
00:25:44.192 --> 00:25:51.461
Of like, here's a partner that is being summoned by their client to come in and answer the question, how are you applying AI to my work?
00:25:52.082 --> 00:25:56.852
And that is a commercial question that is not a question of legal work competence.
00:25:56.852 --> 00:26:04.761
That is a question of expecting you to inflect a change into our business relationship by virtue of the capabilities that are now coming forward.
00:26:04.882 --> 00:26:17.781
And a partner is saying like, how do I make sure I'm positioning myself, not just defensively and trotting out, you know, whatever kind of perfunctory or obligatory experts that we may have in the house, but how do I turn this into an opportunity to cultivate the relationship?
00:26:18.201 --> 00:26:23.541
And to deepen and to find new ways to communicate how our value is different.
00:26:24.290 --> 00:26:31.432
And to do that, to do all of that, we have systems of expertise that we've authored around, you know, all of these different categories of context.
00:26:31.432 --> 00:26:40.499
But also a, a map of all the commercial journeys such that every commercial situation can be located, in terms of like a commercial journey and a phase in that journey.
00:26:40.858 --> 00:26:47.909
And you know, that provides an ontology essentially of legal buy that connects it with the jobs that must be done by that partner in that situation.
00:26:48.269 --> 00:26:57.659
And puts it up against the very unique dials and contexts and different values and fields of the, uh, firm and the partner and the client and the, and the practice and all of that as well.
00:26:58.048 --> 00:27:20.769
And so we have spent the last year, so fun, the last, the past year extracting that expertise and hammering it into structures that are, you know, mutually exclusive, collectively exhaustive, and equip AI to be able to then come in and with that sort of spooky intuition, be able to assert and apply that expertise into a situation.
00:27:21.285 --> 00:27:25.088
And that's what we believe is important and that's what we think is the moat.
00:27:25.328 --> 00:27:27.519
That's what we think Claude will never have access to.
00:27:27.878 --> 00:27:36.548
Uh, but that in a way that we can educate AI to its maximum effect, um, has been our mission and really kind of like our excitement.
00:27:37.326 --> 00:27:40.461
Jae, how did, how did you get your brain, your data into that moat of a box?
00:27:42.978 --> 00:27:53.387
Well, okay, let me, let me actually back up because I think, you know, I hardly ever really talk about my work experience inside the, the four walls of a law firm.
00:27:53.387 --> 00:27:55.577
I played a number of different roles.
00:27:55.917 --> 00:27:58.288
I've been very fortunate in my career.
00:27:58.651 --> 00:28:06.211
Since I was 27 years old, every job title I've ever held was new to me and new to the firm that gave it to me.
00:28:06.661 --> 00:28:14.736
And then so I have had the opportunity to really, facilitate uh, legal buy and service delivery at the matter level.
00:28:14.736 --> 00:28:19.465
At the client relationship level, uh, I've had the opportunity to manage that.
00:28:19.465 --> 00:28:23.905
The partner book level, I have done performance reviews at the practice group level.
00:28:24.145 --> 00:28:36.215
And then, you know, culminating kind of my W2 career, um, as the global head of pricing strategy for Baker McKenzie, I oversaw pricing for 46 countries, $3 billion a year.
00:28:36.521 --> 00:28:46.692
So that is really a full service, uh, global perspective of how clients want to buy legal services, why they need lawyers in the first place.
00:28:47.021 --> 00:28:52.781
And the, what is the value proposition that's the partners actually create and deliver with their teams.
00:28:52.781 --> 00:28:54.251
How do they explain that?
00:28:54.251 --> 00:28:54.672
Right?
00:28:54.912 --> 00:28:58.751
Um, when I walked into Baker McKenzie, I was 35 years old.
00:28:58.781 --> 00:29:11.134
Uh, I had only worked in the US market, although I think I was quite well known for work across client service, operations, delivery, as well as innovation, um, and, um, pricing for value.
00:29:11.134 --> 00:29:13.894
But still, it was a very broad scope.
00:29:13.894 --> 00:29:26.673
And I think the only reason that I was able to discharge the role is because I, I think I brought a completely different perspective than other commercial advisors working in the space.
00:29:26.673 --> 00:29:31.564
And that is, um, a fundamentally human centered view.
00:29:31.923 --> 00:29:34.173
Um, that it is a relationship business.
00:29:34.173 --> 00:29:35.523
It always will be.
00:29:35.884 --> 00:29:42.693
And that I, uh, I think I brought a, a more open-minded attitude to the lawyer answer of "it depends".
00:29:43.594 --> 00:29:47.973
Um, it absolutely depends what is, you know, an engagement worth?
00:29:47.973 --> 00:29:49.773
It depends on who the client is.
00:29:49.773 --> 00:29:53.284
It depends on, you know, where they are in the company life cycle.
00:29:53.284 --> 00:29:55.594
It depends what's going on in the world around them.
00:29:55.834 --> 00:30:09.753
It depends on who we are as a firm, uh, and, you know, kind of the whole lineup of other viable providers who could, you know, offer something similar, better, worse, in different ways?
00:30:09.753 --> 00:30:18.334
It depends who the partner is, what the relational history that partner has with the people making the outside counsel selection decision.
00:30:18.334 --> 00:30:24.844
It depends how much we know about them as people, how much we know about them as teams and as a business.
00:30:24.844 --> 00:30:31.153
And then, so all of these dimensions... you know, firms and partners have intuition.
00:30:31.153 --> 00:30:35.009
They have information that is trapped somewhere.
00:30:35.278 --> 00:30:42.328
And, uh, here's something, uh, I get to a big topic where I would like to shift the industry discussion a little bit.
00:30:42.328 --> 00:30:46.769
And I think both of you really liked this point when I saw you in New York last week.
00:30:47.189 --> 00:30:59.321
There is a great rush toward master data, kind of, uh, strategies, different ways to evolve, how the firm organizes, catalogs, all the data that they have in their systems.
00:30:59.321 --> 00:31:01.301
And that is a necessary endeavor.
00:31:01.541 --> 00:31:02.892
I'm not saying that it's not.
00:31:03.626 --> 00:31:12.596
But the idea that firms have to wait for that journey to progress before they embark on, you know, the much more difficult journey of getting
00:31:12.596 --> 00:31:17.156
I reject that premise completely.
00:31:17.426 --> 00:31:30.602
Um, because I think the, the pricing exercise in particular has to do with extracting the intuition and insights that reside within partners' minds.
00:31:30.811 --> 00:31:33.571
Within clients' minds, right?
00:31:33.872 --> 00:31:44.991
And the idea that we have this natural language interface, where we can give those people a teammate to really embed into their daily experience the lived experience of work.
00:31:45.261 --> 00:31:50.902
And to figure out the proposition together, to figure out the positioning together.
00:31:51.112 --> 00:31:55.011
I think that is an application of AI that is completely missing.
00:31:55.311 --> 00:32:08.429
And the experience that Ed and I are trying to bring to rainmakers everywhere, current and the next generation of rainmakers, is to give them a teammate who is really deeply invested in their success.
00:32:08.699 --> 00:32:20.009
Who, you know, rides alongside with them, learns them, what they're good at, what they're about, the expertise and the client that they apply to, the client problems they solve.
00:32:20.338 --> 00:32:27.088
What is the value of the platform and the synergy that the partner gets from being on that particular platform?
00:32:27.449 --> 00:32:37.229
How do they engage in meaningful dialogue with clients to really get at a shared understanding of what the problem is and how the firm can help solve that?
00:32:37.229 --> 00:32:37.679
Right?
00:32:38.128 --> 00:32:42.028
And then, so to me it is less about a data crunching problem.
00:32:42.028 --> 00:32:44.848
It's less about a data aggregation problem.
00:32:44.848 --> 00:32:48.719
And it's more a communication and collaboration issue.
00:32:49.019 --> 00:33:00.148
And then, so when I think about readying the next generation of lawyers, um, to practice as practitioners and that kind of hallowed trusted advisor role, right?
00:33:00.358 --> 00:33:03.538
How do we prepare them to take on that mantle?
00:33:04.169 --> 00:33:05.669
Well, listening is one.
00:33:05.669 --> 00:33:08.219
But like, you know, listening real hard is not enough.
00:33:08.939 --> 00:33:13.378
They have to listen and hear and understand what it means, right?
00:33:13.378 --> 00:33:30.221
So when I talk about noticing skills that, you know, junior lawyers, senior associates, new partners need to develop, it is the ability to actually quickly locate the client within a complex matrix of situations, right?
00:33:30.401 --> 00:33:34.240
How do you orient yourself and the client to where they're sitting?
00:33:34.240 --> 00:33:42.013
And then what is the range of probable, kind of, uh, situations that are going to develop from the current situation.
00:33:42.013 --> 00:33:56.953
And then, so being a trusted advisor really means understanding how to apply, uh, quickly your deep expertise to the specific concrete, uh, situation that this particular client is in.
00:33:57.374 --> 00:34:10.298
And in order for our AI to help partners do that, we have to teach our rainmaker companion to quickly locate the partner in the commercial situation in which they find themselves right.
00:34:10.719 --> 00:34:18.739
So a lot of the expertise extraction, which has been fascinating and, and, um, I have to tell you, very difficult work.
00:34:18.838 --> 00:34:23.592
In my career I have rarely been cognitively taxed in this way.
00:34:24.012 --> 00:34:32.922
Um, I have to say, the jobs that I had at Seyfarth and Bakers, and in my consulting practice for Global 50 firms, I have come across a lot of complexity.
00:34:33.163 --> 00:34:39.833
But most of the, what I found taxing was relational, political, social, emotional.
00:34:40.072 --> 00:34:43.463
It was not like cognitively taxing, like this kind of work.
00:34:43.853 --> 00:34:46.463
It is really about, uh, compression.
00:34:47.092 --> 00:34:51.503
So I, I think that's an issue that we're not talking about enough.
00:34:51.592 --> 00:35:01.043
What AI enables us to do is compress a huge set of possibilities, a huge set of variables.
00:35:01.373 --> 00:35:06.802
And to help process through that and then narrow down the range of possibilities.
00:35:07.103 --> 00:35:10.853
And to help people navigate complexity in a completely new way.
00:35:11.182 --> 00:35:16.132
And then, so in order to compress my understanding of the global legal market.
00:35:16.628 --> 00:35:17.927
You know, I'll give you an example.
00:35:18.983 --> 00:35:26.726
Uh, we reduce, kind of the universe of legal service buyers to, uh, first 12 and 10 buyer archetypes.
00:35:27.056 --> 00:35:30.445
Um, this is not a demographic segmentation.
00:35:30.445 --> 00:35:35.815
It is truly a demographic and a behavioral profile.
00:35:36.085 --> 00:35:43.405
Depending on the sector, the composition, the nature of their business, the range of needs that they would typically experience.
00:35:43.766 --> 00:35:50.846
And then the range of buying behaviors that I have seen in 10 years of analyzing, uh, legal market dynamics.
00:35:50.846 --> 00:35:56.996
We have defined these archetypes of, of legal service buyers, the organizations themselves.
00:35:57.445 --> 00:36:12.030
Um, we have, through really deep thinking, defined six archetypes of partner roles in Rainmaking, because rainmaking is no longer a solo sport, even though it still feels that way to so many partners.
00:36:12.541 --> 00:36:17.340
Rainmaking at the highest level is not just a team sport, it's actually a position sport.
00:36:17.371 --> 00:36:25.860
And being successful means really understanding where your strengths lie, uh, as it relates not only to your disposition and your skills.
00:36:25.860 --> 00:36:34.914
But your practice modality, the career phase you happen to be in, where you shine now and where you need to develop.
00:36:34.914 --> 00:36:43.534
So these three dimensions that you see to the right expertise, origination account, this will map to a phrase that many people have heard
00:36:43.534 --> 00:36:45.815
finders, minders, grinders.
00:36:46.565 --> 00:36:50.344
Expertise, though, is the way that I would express production.
00:36:50.675 --> 00:36:55.355
Production is a key driver of partner compensation in all firms still.
00:36:55.355 --> 00:37:00.635
And I expect that to actually increase in importance because of the impacts of AI on leverage.
00:37:00.905 --> 00:37:06.605
Um, but it's not really just the mechanics of producing hours and, uh, time entries into bills, right?
00:37:06.605 --> 00:37:12.284
That is the application, and leverage of, of important expertise to issues of consequence.
00:37:12.795 --> 00:37:18.498
Origination obviously is a very lionized aspect of the partner job.
00:37:18.677 --> 00:37:20.568
Something that is not well understood.
00:37:20.568 --> 00:37:25.878
But the third one that I think people don't talk about enough is account management.
00:37:26.447 --> 00:37:30.168
Once you land the first matter, how do you get the next 10?
00:37:30.257 --> 00:37:43.688
How do you build a accumulating and compounding set of trust, not only in you as a, an advisor, but institutionally between the client enterprise and the firm platform that you happen to be on.
00:37:43.838 --> 00:37:50.557
And then depending on your balance, and most partners in my experience, they have a primary strength and a wing.
00:37:50.807 --> 00:38:08.717
And then, you know, over time the balance of their focus on expertise and origination, it does need to shift, uh, depending on firm strategy, the partner's personal kind of goals as to earnings and, you know, work life balance and the way that they wanna spend their hours when they're at work.
00:38:09.108 --> 00:38:13.527
These are choices that the partner makes, consciously or otherwise.
00:38:13.527 --> 00:38:24.228
And what we are trying to do with the rainforest archetypes, and we call it that because we think firms really need to build themselves into ecosystems where it rains more reliably.
00:38:24.648 --> 00:38:33.307
Um, instead of you know, always depending on the mythical powers of the five to 10% of partners typically bring in 80 to 90% of the firm's profits.
00:38:33.697 --> 00:38:39.668
Uh, we believe that firms can actually grow new rainmakers better and faster than other firms.
00:38:39.668 --> 00:38:42.097
We'd love to be that competitive advantage.
00:38:42.568 --> 00:38:54.608
I think that what these archetypes do, and generally our approach of really highly granular context engineering that we bring to the partner's desktop.
00:38:55.358 --> 00:39:00.458
It is to reduce cognitive load without being reductive, right?
00:39:00.458 --> 00:39:02.407
It's not just task offloading.
00:39:02.737 --> 00:39:15.398
We are reducing the, the cognitive load and the emotional distress that many partners feel when they're staring down the barrel of a, of an RFP response that they don't know how to respond to.
00:39:15.398 --> 00:39:16.898
Like a panel pricing bid.
00:39:17.137 --> 00:39:24.307
They don't know how to respond to, uh, maybe a difficult conversation with a client where the relationship's going a little bit sideways.
00:39:24.907 --> 00:39:33.072
These are critical stressors and what they need is better judgment, exercise under stress and time constraints, right?
00:39:33.402 --> 00:39:40.452
And what they really need is a thinking partner that is fully, fully invested in their success.
00:39:40.632 --> 00:39:44.501
Someone who understands the world they operate in.
00:39:44.802 --> 00:39:53.632
Someone who understands the social and cultural context of a very high-end relationship based, buying environment.
00:39:53.902 --> 00:40:01.731
How to navigate all of the different interests that really go into a $20 to$30 million enterprise relationship.
00:40:02.387 --> 00:40:09.177
These are things that I think have been, hidden away behind closed doors for a long time.
00:40:09.177 --> 00:40:21.327
There are not a lot of people who have really worked within these relationships, have facilitated transactions in those relationships, who are not themselves an interested party in that ecosystem.
00:40:21.327 --> 00:40:26.067
And then, so what we're trying to bring to partners is that teammate.
00:40:26.126 --> 00:40:33.097
And I think that the psychological, emotional, relational aspects are just as important as the economics.
00:40:33.097 --> 00:40:42.737
Although, of course, if people wanna vet that, there's a great body of work that I have put out on the internet for free in terms of the, the economics of legal buy.
00:40:42.976 --> 00:40:48.286
I think uniting all those things is incredibly important, especially in this moment.
00:40:48.617 --> 00:40:54.797
So now I will say a little bit of, of what I think is happening to the legal market in the next five years.
00:40:55.697 --> 00:40:58.967
Everybody wants to know what's gonna happen to the pricing model.
00:40:59.086 --> 00:41:04.367
And everybody wants to know what's gonna happen to lawyer compensation as a result of that.
00:41:04.786 --> 00:41:07.481
Again, I, I know it's frustrating, but it's gonna depend.
00:41:08.746 --> 00:41:10.487
Depend what kind of lawyer you are.
00:41:10.487 --> 00:41:12.887
It's gonna depend what kind of firm you're at.
00:41:12.887 --> 00:41:17.626
It depends what kind of client problems you solve today, and it depends how you solve them.
00:41:17.927 --> 00:41:29.867
Most of all, it depends how much you're willing to change the way you apply your expertise to deliver outcomes and experiences for your clients, right?
00:41:29.867 --> 00:41:34.186
So there's a lot of variables in play, but I will tell you the most important thing.
00:41:34.606 --> 00:41:40.157
Um, the battlefield for the next two years is not actually gonna be on profit margin.
00:41:40.427 --> 00:41:43.157
It is going to be on wallet share.
00:41:43.856 --> 00:41:51.086
The firms that win on wallet share, the firms that anchor enough of the right relationships with the buyers.
00:41:51.086 --> 00:41:57.927
Where they can figure out the AI enabled future together with a handful of house accounts.
00:41:58.601 --> 00:42:08.771
Where there is sufficient trust to figure out the AI delta together and an equitable split of the new economics, they're gonna be ahead.
00:42:09.211 --> 00:42:20.702
Even in market share, where there, there aren't those sizable, chunky relationships, partners really need to secure revenue at increasing rates.
00:42:20.762 --> 00:42:21.391
Yes.
00:42:21.722 --> 00:42:23.311
Rates will go up.
00:42:23.371 --> 00:42:25.621
They are going up a lot this year.
00:42:25.621 --> 00:42:27.722
They're gonna go up a lot next year.
00:42:27.992 --> 00:42:28.382
Right.
00:42:28.621 --> 00:42:36.068
The partners who are able to secure, uh, a flow of work at those rates, they will have an advantage.
00:42:36.331 --> 00:42:36.661
Right?
00:42:36.661 --> 00:42:42.211
So the next two years is really gonna be wallet share, market share rates and realization.
00:42:42.481 --> 00:42:44.161
That's the, that's the battle.
00:42:44.402 --> 00:42:48.152
And it's gonna be a street fight for demand the next two years.
00:42:48.481 --> 00:42:53.836
The pricing model innovation that will shake out in the years following.
00:42:53.867 --> 00:43:00.347
Now, the firms that are gonna be ahead in that race, they are looking at leverage impacts of AI.
00:43:00.717 --> 00:43:10.887
But unless you can win the work, unless you can get clients to trust you with work that still needs to get done at an extreme level of excellence.
00:43:10.887 --> 00:43:17.246
You're not gonna have as much ground to defend in that pricing and profit fight.
00:43:17.527 --> 00:43:27.277
Right now we believe that winning work and winning revenue ought to be the top priority of every partner in the AmLaw 200.
00:43:27.516 --> 00:43:32.737
I have personally spoken with scores of law firm leaders and they all agree.
00:43:33.126 --> 00:43:40.507
Um, and then so I think rainmaking is, is an important, important skillset that is also shifting dramatically, right?
00:43:40.777 --> 00:43:58.996
Uh, one of the things that Ed and I have been saying to many lawyers is that the last three classes of partners that have been promoted, and the last three classes of associates that have been hired, into the Global 200, they are quite possibly the most important classes of lawyers that have ever been.
00:43:59.416 --> 00:44:05.867
Together, those two groups are going to define the future of the legal profession and, and the business of law.
00:44:06.800 --> 00:44:07.175
I love it.
00:44:07.206 --> 00:44:11.585
So I'm gonna reflect three things back that I heard that are really important that I want all of our listeners to think about.
00:44:11.746 --> 00:44:15.976
Number one is that, rainmakers are like Willie Sutton said, they said, why did you rob banks?
00:44:15.976 --> 00:44:17.295
He said, well, that's where the money is, right?
00:44:17.295 --> 00:44:21.835
So you by chasing rainmakers, business development equals rainmaking equals sales.
00:44:22.085 --> 00:44:27.246
And so you can imagine that if I'm a rainmaker, I will spend $1 on Lumio to make $10 in rainmaking.
00:44:27.246 --> 00:44:29.465
So number one, kudos on chasing the right market.
00:44:29.465 --> 00:44:31.266
You're going where the money is, like Willie Sutton did.
00:44:31.596 --> 00:44:34.769
Number two, your point about compression, being able to take your brain and.
00:44:34.769 --> 00:44:38.199
Be able to then, offload your brain, in a way that is systematic.
00:44:38.260 --> 00:44:42.099
Any particular data point, you might only use one rifle shot of that in a conversation.
00:44:42.309 --> 00:44:44.050
But what you're doing is not just rifle shots.
00:44:44.050 --> 00:44:51.376
You're essentially doing a Gatling gun of all the things that you've ever learned and trying to offload that into an artifact that is a software.
00:44:51.376 --> 00:44:52.757
To be able to then offload your brain.
00:44:52.947 --> 00:44:54.657
That is incredibly taxing and exhausting.
00:44:54.657 --> 00:44:59.547
And I think that, Jae today, Rob Saccone today, who you and I know, like we were just talking.
00:44:59.577 --> 00:45:05.137
Rob and I were having a conversation about how each of us has five different things that we're doing with Claude Code.
00:45:05.166 --> 00:45:09.217
Five different tabs that we're constantly going and taxing our brains in ways that we haven't been before.
00:45:09.217 --> 00:45:12.052
So I think this is a precursor of what lawyers are gonna be doing.
00:45:12.052 --> 00:45:16.467
Is that we are gonna be offloading our brain and compressing our brain in ways that we've never before.
00:45:16.547 --> 00:45:17.217
That's point number two.
00:45:17.297 --> 00:45:25.731
Point number three is you're talking about, you're counting all of the "it depends." Of course, every time somebody would say to me... well, a lawyer would say, "well, it depends," I would say it depends on what?
00:45:25.972 --> 00:45:28.271
And then whatever comes outta their mouth, I put it into SALI.
00:45:28.612 --> 00:45:30.141
And these days I put it into FOLIO.
00:45:30.231 --> 00:45:30.442
Right?
00:45:30.442 --> 00:45:34.911
So the counting of the, "it depends." Counting all of the "it depends" is of course the most important thing.
00:45:34.911 --> 00:45:42.211
So maybe I'll do that as a leaping off point to be able to say, knowing we only have four minutes left, what are all of the "it depends" that you're really counting.
00:45:42.211 --> 00:45:44.242
And how do those make their way into the system?
00:45:44.481 --> 00:45:45.681
That's one question.
00:45:45.681 --> 00:45:48.161
And then, before we close, we also wanna know about optimism.
00:45:48.161 --> 00:45:49.371
So maybe you could do those both.
00:45:49.402 --> 00:45:51.771
How do you count all the, it depends and leverage it in Lumio?
00:45:51.952 --> 00:45:53.101
And then what are you optimistic about?
00:45:54.016 --> 00:45:57.737
I take optimism and let Ed tell you about all the it depends.
00:45:58.411 --> 00:46:00.090
Uh, so the it depends.
00:46:00.240 --> 00:46:07.291
And you know what I would characterize by the way to even make it more reductive is, um, on your first point, Damien.
00:46:07.291 --> 00:46:17.246
Yes, the money matters, but like it's a system of incentives that lead us at Lumio to play in a space where firms want this and partners want this too.
00:46:17.635 --> 00:46:20.246
And I'm not sure you can say that about AI everywhere else.
00:46:20.768 --> 00:46:25.045
That firms want it and partners want it, that they inherently are incentivized to really want it.
00:46:25.045 --> 00:46:28.166
And that's both institutional, that's economic, but it's also personal.
00:46:28.695 --> 00:46:33.956
Like, there are partners out there who are willing and able to understand and grow their client relationships.
00:46:34.385 --> 00:46:35.976
And we say it's a relationship business.
00:46:35.976 --> 00:46:41.885
And maybe they're not among the kind of like, those that are so highly extolled inside of law firms.
00:46:41.885 --> 00:46:45.576
Where they're like, it's a relationship business means Jack over there is gonna get all the business.
00:46:45.846 --> 00:46:49.476
There are people, there are partners who are hungry 'cause and they're willing and they're able to do more.
00:46:49.896 --> 00:46:54.036
But the second thing that, I'll just combine your second and their points is like, humans couldn't do this before.
00:46:54.626 --> 00:46:56.735
Before AI, humans just couldn't do this.
00:46:56.976 --> 00:46:59.135
And so you're asking like, what are all the, it depends.
00:46:59.166 --> 00:47:04.655
And how do you... how do we leverage vast intelligence to stack all of those lenses on top of each other?
00:47:04.655 --> 00:47:09.722
Every single time we encounter every single partner question that comes in about any single commercial moment.
00:47:10.052 --> 00:47:19.443
At every single moment, to bring the richness of, of everything that, like, it's all, it was nearly impossible for a human to ever do, even once on our best of days.
00:47:19.443 --> 00:47:22.847
And we're living in a world of like, a lot of very stressed days, you know?
00:47:23.052 --> 00:47:25.413
And so how do we, how do you bring that all together?
00:47:25.682 --> 00:47:30.722
Um, and I would just break them into kind of three things that, this is how we talk about the expertise at Lumio.
00:47:30.963 --> 00:47:34.742
One is that context, the firm, we've got archetypes for the firm.
00:47:34.742 --> 00:47:39.393
So it's not just these six commercial personas for partners, but yes, there are partner archetypes as well.
00:47:39.663 --> 00:47:44.612
And so there are like any number of kind of permutations and combinations of seeing them in combination.
00:47:45.032 --> 00:47:48.032
Um, there are clients in how they buy, what, like Jae talked about.
00:47:48.213 --> 00:47:56.443
There are some similarities because of the business constraints and the business demands that actually are very much inflected into how legal buyers buy.
00:47:56.503 --> 00:48:02.592
And yes, there's some variants like Dell and HP might buy weirdly very differently, even though they're very similarly positioned companies.
00:48:02.802 --> 00:48:10.762
But actually there's still enough in common about like, you know, the industry and their business model that actually informs how legal buyers buy and what their business interests are.
00:48:11.152 --> 00:48:25.012
Uh, there are things around the, um, sector at large, which is different than the buyer type that have to do a little bit more with kind of like the trends of the sector and what's happening in kind of asset class transformation and like in the rise of pri private capital, both equity and now credit.
00:48:25.393 --> 00:48:29.887
We also have kind of systematized opportunities themselves.
00:48:29.918 --> 00:48:34.297
For any micro opportunity that comes in for anything that's like, there's an engagement, it's here.
00:48:34.418 --> 00:48:35.288
How do we approach it?
00:48:35.557 --> 00:48:39.307
There's actually something around the objective and purpose of that engagement itself.
00:48:39.547 --> 00:48:42.927
So a lot of times a challenger trying to displace an incumbent and get takeaway work.
00:48:43.788 --> 00:48:50.413
They view the opportunity with a very different gross margin profile than, for instance, an incumbent that's this is engagement number 35 for them.
00:48:50.742 --> 00:48:57.282
And so like the opportunity types themselves have their own kind of like taxonomy, um, ontology that that informs them.
00:48:57.672 --> 00:49:01.333
And there's countless other things I'll just say that are really about the context.
00:49:01.693 --> 00:49:03.253
We try to separate that a little bit.
00:49:03.253 --> 00:49:04.483
Although there's tons of overlap.
00:49:04.483 --> 00:49:11.083
And you could say, you know, tomato, tomato, around the actual situation and like, what is the play to be called in this situation?
00:49:11.083 --> 00:49:13.213
And what is the partner actually asking?
00:49:13.213 --> 00:49:14.172
What are they dealing with?
00:49:14.172 --> 00:49:15.463
Are they focused on the right thing?
00:49:15.672 --> 00:49:18.342
Do they understand what step of what journey that they're actually in?
00:49:18.342 --> 00:49:20.382
And what a win actually looks like for them?
00:49:20.592 --> 00:49:21.702
What is their passing range?
00:49:21.702 --> 00:49:22.753
Like, what's available to them?
00:49:22.932 --> 00:49:28.302
Which is a little bit different than just kind of like, you know, what's on the field, but it's a little bit about like what's the play to call.
00:49:28.693 --> 00:49:31.902
And then once the play is to be called and run.
00:49:31.994 --> 00:49:38.637
The, then the third thing that we actually think about that's very important when dealing with partners at law firms is, uh, what do you say to them?
00:49:39.478 --> 00:49:41.818
Like, what is the first smallest step to change?
00:49:41.818 --> 00:49:44.547
Like, what is the first thing that we put in the response to the email?
00:49:44.547 --> 00:49:46.367
Because here's what AI does.
00:49:47.117 --> 00:49:54.650
It shoots from the hip to generate as much text as possible to answer as many questions as possible and satisfy them completely in one shot.
00:49:55.277 --> 00:49:56.478
It is generally the case.
00:49:56.577 --> 00:50:01.557
Now, I know that there's like ohoh, like, you know, different models get a little bit cuter about clarifying questions and things like that.
00:50:01.827 --> 00:50:06.807
But in general, there's this desire to satisfy every possible thing on one shot.
00:50:06.987 --> 00:50:12.838
And what we know and what, like the UX design choice by the way that we made, is that we have a headless UI that just lives in the communication layer.
00:50:13.108 --> 00:50:15.447
Email and over time Teams chat, right?
00:50:15.648 --> 00:50:23.367
Because that's where partners, it turns out know how to do things, is, is what our research reveals is that they're okay at email over many years it's, it's taken to get there.
00:50:23.518 --> 00:50:27.807
So, um, what is the first response that will actually engage them?
00:50:28.452 --> 00:50:29.862
We've done a ton of user research.
00:50:30.103 --> 00:50:35.083
What energy they want to meet them back when they have these questions actually is half of the battle.
00:50:35.353 --> 00:50:43.483
Of getting them engaged and actually getting them into this conversation and, increasing their commercial acumen and developing, um, their thinking around these things around the relationship.
00:50:43.632 --> 00:50:53.112
And so the context, the situation, and the kind of response mode is, these are all systems that we have authored where there is a, as much meia as possible.
00:50:53.112 --> 00:50:57.012
And then they all intersect and have the beginnings of a graph where they all kind of tie together.
00:50:57.373 --> 00:51:01.032
And then that sort of dictates essentially what goes back into one email.
00:51:01.362 --> 00:51:03.762
Response to one partner that asks us one question.
00:51:04.782 --> 00:51:11.773
And that's what we're trying to bring in terms of the richness of expertise as applied through an AI teammate in the communication layer on an everyday basis.
00:51:11.833 --> 00:51:15.432
So, um, we're very excited about those systems of expertise.
00:51:15.432 --> 00:51:18.552
There are probably like 20,000 more waiting for us.
00:51:18.702 --> 00:51:22.003
We're trying to make them as elegant and as simple as possible.
00:51:22.242 --> 00:51:25.213
One of the ones that's coming very soon is actually pricing expertise.
00:51:25.693 --> 00:51:28.278
And we know that that's something where there's a huge amount of demand.
00:51:28.393 --> 00:51:35.503
And what partners have to do to both kind of get the price that's been set by their rate card and like apply that to the situation negotiation.
00:51:35.952 --> 00:51:40.722
Um, and also to manage that price, both sort of for the account level and for the engagement level.
00:51:40.902 --> 00:51:43.543
These are kind of the next systems of expertise that are coming online.
00:51:43.543 --> 00:51:45.072
So stay tuned for that.
00:51:45.072 --> 00:51:47.532
But that's part, that's all part of the commercial acumen story as well.
00:51:47.936 --> 00:51:51.686
I love everything you just said and what I like most about yours is headless.
00:51:51.686 --> 00:51:54.117
And for those who don't know, headless is like, you don't have a website.
00:51:54.117 --> 00:51:57.237
You just have, uh, interacting via Teams or via email.
00:51:57.288 --> 00:52:00.047
Smart for a lot of reasons 'cause one, that's where the lawyers are.
00:52:00.228 --> 00:52:01.728
Number two, that can't be scraped.
00:52:01.858 --> 00:52:05.777
That's really smart, that essentially nobody can scrape your website to be able to get all the stuff from Jae's brain.
00:52:05.807 --> 00:52:09.407
Kudos to you on that choice, both from a UX standpoint and a can't be scrape point.
00:52:09.588 --> 00:52:11.447
With that, Jae, what are you optimistic about?
00:52:12.548 --> 00:52:17.829
I'll, I'll build on everything Ed said and do a teaser of things we will never publish.
00:52:18.128 --> 00:52:27.849
One dimension of the expertise are the, uh, legal business value propositions that, you know, express why clients need lawyers.
00:52:28.179 --> 00:52:41.559
Um, and then 34 elements of value in, in terms of like, what, what is valuable in the entire relationship, in the, you know, advice, the solutions, the outcomes that are delivered and how it's delivered, right?
00:52:42.353 --> 00:52:43.704
We will never publish those.
00:52:43.704 --> 00:52:49.373
'cause that is probably part of the crown jewels, uh, in the, the brightest jewels in the crown.
00:52:49.373 --> 00:52:53.153
And, um, something that will anchor pricing advisor.
00:52:53.483 --> 00:53:00.773
I mentioned those two things because the, the buckets of business legal value propositions are not going away.
00:53:01.224 --> 00:53:07.043
So this broad, generalized fear of lawyer displacement is ill-founded.
00:53:07.554 --> 00:53:16.403
Um, in terms of, you know, the, the ways in which, uh, you know, trusted advisors deliver value to clients, that's not going away.
00:53:16.943 --> 00:53:19.583
The basis of my optimism is this.
00:53:19.853 --> 00:53:28.956
I, I have stayed in legal for many years despite having very portable skills, because lawyers are some of the smartest people I could ever hope to work with.
00:53:29.233 --> 00:53:33.489
I love lawyers, I love partners, and, you know, I love legal business.
00:53:33.518 --> 00:53:38.889
But one of my deep beliefs is that lawyering is one of the eternal professions.
00:53:39.579 --> 00:53:45.398
Um, no matter where you go in this world, no matter how far you go back, there are things that people just need.
00:53:45.829 --> 00:53:53.898
People need, you know, healers, people need teachers, and people need advocates to help them pursue what is fair and equitable.
00:53:54.318 --> 00:53:55.048
And then, so, okay.
00:53:55.134 --> 00:53:56.563
Lawyers are the second, second oldest profession.
00:53:58.143 --> 00:54:02.764
Yes, and the oldest profession will, will innovate and persist as well.
00:54:03.063 --> 00:54:06.664
But, um, you know, I think that is all cause for optimism.
00:54:06.664 --> 00:54:15.393
But the, the main message of opt optimism I have is this, change is inevitable, suffering is not.
00:54:15.907 --> 00:54:22.717
I think that, you know, I don't wanna overvalue kind of the Jevons' Paradox and say like, there will be more jobs, so don't worry.
00:54:22.717 --> 00:54:30.351
Because that, that kind of implies everybody who has jobs will keep them and the more people have new jobs that don't exist, and that's not gonna happen.
00:54:31.476 --> 00:54:33.757
Jobs will change, right?
00:54:33.786 --> 00:54:39.217
Like AI displaces tasks, not jobs, but jobs will change significantly.
00:54:39.217 --> 00:54:48.367
And, you know, the tasks they're a like asked to discharge, uh, how they're measured, how they're paid, how they work with others, like all of that will change.
00:54:48.367 --> 00:54:51.306
And that change is coming for everybody, right?
00:54:51.643 --> 00:55:00.193
But the way you respond to the, the, you know, challenges and opportunities that emerge will determine your fate, right?
00:55:00.193 --> 00:55:01.512
It is in your hands.
00:55:01.512 --> 00:55:13.023
And the ethos that we bring to product design and the overall experience working with Lumio that we wanna deliver to lawyers and partners is
00:55:13.023 --> 00:55:15.902
you are in the driver's seat.
00:55:15.992 --> 00:55:28.143
Like we really want to put partners in the driver's seat of their books, the kind of work they bring in, the kind of work they lead, the kind of career they wanna have now and in the future.
00:55:28.443 --> 00:55:36.873
That level of agency is so important that people feel empowered and equipped and supported to chart their own future.
00:55:37.333 --> 00:55:50.952
And my stake in pricing and the reason that I have poured so much of myself, um, into understanding how things are priced is because the ability to articulate and advocate for yourself.
00:55:51.643 --> 00:56:02.233
The value of the work that you put into this world is so central to people's sense of worth, sense of fulfillment, and sense of accomplishment in their career.
00:56:02.503 --> 00:56:05.143
I consider it, of course, yes.
00:56:05.293 --> 00:56:12.123
It is a driver of economic activity and it's, it's a very lucrative thing to know a lot about.
00:56:12.782 --> 00:56:20.313
But truly the, the value that we return back to the partners when they feel in control of their careers.
00:56:20.313 --> 00:56:30.842
When they feel confident and excited to go pursue business, when they feel equipped to really explain this is why our team is worth what we're asking.
00:56:31.172 --> 00:56:40.382
That level of engagement and just kind of the light in their eyes is worth more to me than you know, all of the praise in the world.
00:56:40.652 --> 00:56:43.583
Kind of like the light in our eyes as we're listening to you speak right now.
00:56:43.643 --> 00:56:50.612
Uh, so with that, we're gonna run the analytics at the end of this episode, but I think this might be the highest word count that we've ever done on a "Further Comments".
00:56:50.612 --> 00:56:55.833
I think the amount of signal, uh, lack of noise that we've done, I think we've now reached the words per minute, the highest episode.
00:56:56.012 --> 00:56:58.143
Horace, I'm gonna leave it to you to, to close this out.
00:56:58.143 --> 00:57:00.782
But, uh, thank you so much, Ed and Jae for your brilliance.
00:57:00.813 --> 00:57:03.842
Uh, this has, this has been a great fun and I'm really thrilled about what you're building.
00:57:03.932 --> 00:57:04.413
Uh, Horace.
00:57:05.192 --> 00:57:06.541
Just echoing all of that.
00:57:06.541 --> 00:57:17.606
You might have noticed I said basically nothing this entire episode is because I didn't want to contribute any noise to to this enormous volume of of signal and information that you guys are just dished out.
00:57:18.068 --> 00:57:19.389
My mind is blown.
00:57:19.509 --> 00:57:27.969
I'm gonna listen to this episode again maybe a few more times to see what I can pull out of it, but everything you've said just resonates so deeply.
00:57:27.969 --> 00:57:31.028
And thank you for sharing it with us, with the audience.
00:57:31.298 --> 00:57:36.728
And I can't wait to see the next iteration of your tool and this pricing tool that you'll be releasing.
00:57:37.416 --> 00:57:37.896
Thanks, Jae.
00:57:37.947 --> 00:57:40.768
Because conversations that you guys have is are great.
00:57:40.768 --> 00:57:41.668
We're glad to be part of it.
00:57:41.668 --> 00:57:42.628
So thank you so much.
00:57:43.291 --> 00:57:43.371
Thank you.
00:57:43.451 --> 00:57:44.586
you for listening.
00:57:44.586 --> 00:57:49.356
And, uh, yeah, if you want more, uh, more people like Jae and Ed, uh, please let us know who you'd like to come on.
00:57:49.489 --> 00:57:52.699
thanks What a way to start season three! Amen.